United Kingdom Employee Cost Calculator
See the true cost of employing someone in United Kingdom — gross salary plus an estimated 18.0% in employer social contributions.
Cost of an employee in United Kingdom
Employer contribution breakdown
| Contribution | Rate | Annual amount |
|---|---|---|
| Employer National Insurance (above £5,000) | 15.00% | — |
| Auto-enrolment pension (minimum) | 3.00% | — |
| Total employer contributions | 18.0% | — |
Employer costs in United Kingdom
In the UK, the main employer cost on top of salary is employer National Insurance at 15% (from 6 April 2025) on pay above the £5,000 secondary threshold, plus a minimum 3% workplace-pension contribution under auto-enrolment.
- Employer National Insurance is 15% on earnings above the £5,000 secondary threshold.
- Auto-enrolment pension: employers must contribute at least 3% of an eligible worker's qualifying earnings.
- Because NI applies only above £5,000 and pension only on qualifying earnings (£6,240–£50,270), the effective rate is a little below 18% for most salaries.
This is a budgeting estimate. It excludes the Apprenticeship Levy (0.5%, large employers over £3m payroll) and any benefits or salary sacrifice. Employment Allowance can reduce employer NI for smaller employers.
Hire and pay in United Kingdom
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Frequently asked questions
On top of gross salary, an employer pays statutory social-security contributions — around 18.0% in United Kingdom. The total employer cost is the gross salary plus those employer contributions. It does not include optional benefits, equipment, or recruitment costs.
Employers must pay mandatory social-security and payroll charges on top of the gross salary the employee sees. These fund pensions, healthcare, unemployment, and similar schemes, and they are a real, recurring cost of employment.
In most countries several contributions are calculated only up to a maximum income base, so the effective employer rate is lower for high salaries. Treat this calculator as a budgeting estimate rather than exact payroll.
Many companies use an Employer of Record (EOR) to hire compliantly in United Kingdom without opening a local subsidiary. The EOR is the legal employer and handles payroll, contributions, and compliance for a monthly fee.